Wholesale
Landing a large order can strain a wholesaler more than losing one. Here is how the timing works, how PO funding differs from working capital, and how to test whether the order is worth funding.
✓ Checking what you qualify for does not affect your credit score.
Updated October 13, 2026 · Merchant Fund Express
A wholesaler that wins a large order has to pay its supplier long before its buyer pays. Three tools can bridge that gap. Purchase order financing pays the supplier directly against a confirmed order. Invoice factoring advances against the invoice once goods are delivered. Working capital or a revenue-based advance is read on your existing bank deposits and can be used for anything, including the supplier deposit.
Which one fits depends on your margin, your buyer’s credit, and how much history your own account already shows.
| PO financing | Invoice factoring | Working capital | |
|---|---|---|---|
| What it is read on | The buyer’s order and creditworthiness, the supplier | The delivered invoice and the buyer | Your own deposits, time in business and credit |
| When money arrives | Paid to supplier before production | After delivery and invoicing | Once your file is approved |
| Who controls the cash | Usually goes straight to the supplier | Advance to you, buyer pays the factor | You |
| Good fit | Thin balance sheet, strong buyer, large single order | Goods delivered, buyer pays slowly | Established account with steady deposits |
For more on the first two, see what purchase order financing is and understanding invoice factoring.
A wholesaler with about $120,000 a month in deposits receives a $180,000 PO from a regional retail chain, net 45 after acceptance. Landed cost is $126,000, a 30% gross margin.
| Date | Event | Cash | Order position |
|---|---|---|---|
| Mar 3 | PO received and confirmed | $0 | $0 |
| Mar 6 | Supplier deposit, 40% | $50,400 out | −$50,400 |
| Apr 10 | Supplier balance before shipment | $75,600 out | −$126,000 |
| Apr 24 | Freight and receiving | $4,500 out | −$130,500 |
| May 1 | Delivered; buyer inspection | $0 | −$130,500 |
| May 8 | Accepted; invoice issued | $0 | −$130,500 |
| Jun 22 | Buyer pays net 45 | $180,000 in | $49,500 |
The order ties up as much as $130,500 for about 108 days before returning a $49,500 gross profit. Any funding cost has to come out of that $49,500, and the payments have to fit a period when the order is producing nothing.
All figures in worked examples are illustrations of the arithmetic, not offers or quotes. Real terms depend on your file and the funder.
Sometimes the better move is to ask the buyer for a deposit, split the order into shipments, or negotiate supplier terms.
Established wholesalers often fund the supplier deposit with working capital and let normal receipts cover the rest. That keeps the buyer relationship untouched, because no third party contacts your buyer. Files are read against our published tiers. See also funding purchase orders and supplier deposits.
Then start the application or check fit first.
No. PO financing is tied to a specific order and usually pays the supplier directly. A cash advance or working capital is read on your own deposits and paid to you.
With PO financing or factoring, often yes, because the funder relies on the buyer paying. With working capital, the buyer is not involved.
Yes. Some wholesalers fund the supplier deposit with working capital and factor the invoice after delivery. Make sure the agreements allow it.
There is no fixed line. Compare the total cost of the money to the gross profit on the order, and decide if what is left is worth the risk.
Same-day decision. Applying takes a few minutes and will not affect your credit score.
